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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
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EXAR CORPORATION
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September 5, 2000
Dear Stockholder:
We write to you in connection with Proposal 2 - approval to increase the
aggregate number of shares of Common Stock authorized for issuance under the
Company's 1997 Equity Incentive Plan ("Plan") by 800,000 shares.
In the past several days you may have been contacted by management regarding
your specific investor policies and practices with respect to the repricing and
option issuance pricing provisions included in the Plan, the Company's past
practices relating to repricing and the price at which options have been issued,
and the competitive pressures impacting the Company's committed efforts to hire
and retain the talented, motivated personnel to best ensure the Company's
continued success (an ever increasing challenge given the extraordinarily strong
local employment conditions).
In response to similar concerns about repricing at the time the Plan was adopted
in September 1997, the Board agreed to limit the repricing provision as follows:
> no more than 20% of the options in the Plan would be repriced;
> the repricing feature would not be extended to options granted to or
held by directors, officers (corporate and Section 16 insiders).
Because approval of Proposal 2 is vital to maintaining the established momentum
and facilitating the ongoing investment in and incentive for the Company's most
critical resource - its employees, we gratefully request reconsideration of your
position on Proposal 2. In order to allay your repricing and option issuance
pricing concerns, we further commit not to invoke the repricing provision, and
will limit the number of shares that can be issued below fair market value to no
more than 20% of the Common Stock authorized for issuance under the Plan, and
will formally seek to eliminate the repricing provision and limit the number of
shares that can be issued below fair market value from the Plan at the September
2001 Annual Meeting of Stockholders.
As Directors, we fully appreciate our obligations to you. For the reasons
already stated, approval of the Plan is critical to the ongoing success of the
Company. Accordingly, we request your affirmative support for Proposal 2.
Thank you for your consideration.
Respectfully,
Exar Board of Directors
Raimon L. Conlisk James E. Dykes
Frank P. Carrubba Ronald W. Guire
Donald L. Ciffone, Jr. Richard Previte
